2003 (9) TMI 9 - HC - Income Tax

Rectification vis- -vis Review by tribunal - Whether Tribunal was legally empowered to review its earlier order passed on February 3 1997 by taking a different view on the same set of facts of the case? - In the instant case by miscellaneous application under section 254(2) the respondent-assessee asked the Tribunal to rectify the mathematical error in the order dated February 3 1997 inasmuch as 704 gms. of ornaments were recovered and the Tribunal has wrongly proceeded on the basis of a figure 995.500 gms. It was pointed out that as per panchanama prepared at the time of search ornaments weighing 711.500 gms. only were recovered from the respondent-assessee but by mistake the Tribunal has treated whole ornaments weighing 995.500 gms. recovered from different relatives as if recovered from the respondent-assessee. The Tribunal having found an apparent mistake has rightly invoked the jurisdiction of rectifying the mistake. - We do not find any merit in the writ petition so dismissed

Issues:
1. Review of Tribunal's earlier order under Income-tax Act
2. Rectification of mistake apparent from the record
3. Jurisdiction of Tribunal to recall its order
4. Discrepancy in weight of recovered ornaments

Analysis:

1. Review of Tribunal's Earlier Order:
The Commissioner of Income-tax sought reference on whether the Income-tax Appellate Tribunal had the legal power to review its earlier order. The Tribunal rectified an error in its previous order and allowed the appeal of the respondent-assessee. The Department argued that the Tribunal exceeded its jurisdiction by reviewing its own order. The Tribunal clarified that it does not possess the power to review its order but can rectify any mistake apparent from the record under section 254(2) of the Income-tax Act.

2. Rectification of Mistake Apparent from the Record:
Section 254(2) empowers the Tribunal to amend any order passed under section 254(1) within four years to rectify any mistake apparent from the record. The provision allows rectification of mistakes, not a review of the order. The Tribunal can rectify mistakes such as procedural errors, not just arithmetical or clerical mistakes. In this case, the Tribunal rectified a mathematical error in the weight of recovered ornaments, which was a mistake apparent from the record.

3. Jurisdiction of Tribunal to Recall its Order:
The Tribunal's power to recall its order is limited to rectifying mistakes apparent from the record. The Tribunal cannot review its order but can correct errors that are evident from the record. The Allahabad High Court emphasized that the Tribunal should not prejudice a party, and the expression 'record' in the phrase 'mistake apparent from the record' includes all relevant documents before the Tribunal. The Tribunal correctly rectified the mistake in the weight of recovered ornaments based on the evidence on record.

4. Discrepancy in Weight of Recovered Ornaments:
The respondent-assessee filed a miscellaneous application under section 254(2) to rectify a mathematical error in the weight of recovered ornaments in the Tribunal's order. The Tribunal found an apparent mistake in considering the total weight of ornaments recovered, leading to the rectification of the error. The Tribunal's decision was based on the evidence presented, and no referable question of law arose from the rectification. Therefore, the reference application was rejected, and the writ petition was dismissed for lack of merit.

In conclusion, the Tribunal's power to rectify mistakes apparent from the record is distinct from the power to review its own orders. The Tribunal correctly rectified a mathematical error in the weight of recovered ornaments, demonstrating adherence to the legal provisions under the Income-tax Act.

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